Canadian oil company Plains Midstream Canada was recently issued four high-risk enforcement actions by Alberta's Energy Resources Conservation Board (ERCB). This was related to an oil spill that occurred in April 2011, which ultimately cost the company nearly $100 million. This expensive and damaging situation could have been prevented if the company used appropriate crack detection and equipment monitoring technologies.

Canadian oil company Plains Midstream Canada was recently issued four high-risk enforcement actions by Alberta's Energy Resources Conservation Board (ERCB). This was related to an oil spill that occurred in April 2011, when 28,000 barrels of crude oil spilled from a pipeline in Northern Sunrise County, Alberta. It was one of the worst spills the company has ever had, reported United Press International.

Plains Midstream said that the April spill was cleaned and the pipeline restarted on August 30, 2011. The company lost nearly $100 million from the spill, losing $21 million in revenue while the pipeline was shut down, reported The Calgary Herald, and spending $70 million to clean up the spill. 

Plains Midstream was criticized by the ERCB for failing to comply with regulations in four areas, according to Oil & Gas Journa?l, including backfill and compaction procedures, operations and maintenance procedures, leak detection and response, and failure to test their emergency response plan.

Oil spill caused by crack in pipe
ERCB's assessment of the spill found that a stress crack in a weld on the 45-year-old pipeline contributed to its failing. A sleeve used for corrosion repair failed, reported United Press International. The company had not inspected the weld when it should have and also didn't properly backfill the area around the pipe, which added additional stress that led to the failure. Plains Midstream has committed to pulling and inspecting all sections of the pipeline that contain similar welds.

The ERCB criticized the company for not having sufficient leak detection systems in place. Their report also criticized Plains Midstream's handling of the situation, from fixing the leak to communicating with the public about the spill. This expensive and damaging situation could have been prevented if the company used appropriate crack detection and equipment monitoring technologies.

ERCB has directed the company to take the following actions to prevent other incidents like this one from occurring in the future, reported Oil & Gas Journal:

  • Confirm and demonstrate that backfill procedures have been integrated into the company's operations
  • Conduct an emergency response exercise by the end of March
  • Implement risk-assessment procedures to identify current and historical risks associated with pipelines and equipment

If the company does not complete these actions by established deadlines, then they may be required to suspend operations partially or fully. The company could also receive up to $500,000 a day in fines for future spills based on new legislation, explained The Calgary Herald.